Three more states banned the sale of Maggi noodles on Thursday and several others sent samples for tests amid rising food safety concerns across the country, sending shares of manufacturer Nestle India plummeting for the second straight day.
Nestle India’s stock fell by nearly 3% on Thursday in the wake of the crackdown by states, while retail chains such as Walmart and Metro AG withdrew the popular instant noodles from their wholesale stores
The ban by Uttarakhand, Gujarat and Jammu and Kashmir came a day after Delhi became the first state to pull down the popular noodles brand from shelves, barely days after food inspectors in Uttar Pradesh found elevated levels of monosodium glutamate (MSG), a flavour enhancer, and lead 17 times above the permissible limit.
Health experts say that excessive intake of lead can cause damage to the kidneys, bones and nervous system and is particularly harmful to children and can cause learning disorders. MSG, on the other hand, can damage the nervous system with long-term use.
The UP food safety and drug administration (FSDA) also filed a criminal complaint against Nestle India besides dragging actors Amitabh Bachchan, Madhuri Dixit and Preity Zinta separately for promoting the ‘two-minute’ noodles brand.
Nestle maintains that its product is safe for consumption as its own internal and external tests showed “lead levels are well within the limits specified by food regulations”.
However, the company’s assertions failed to convince the states amidst the raging controversy.
In Ahmedabad, Gujarat health minister Nitin Patel said the ban, applicable for a month initially, was slapped after samples tested high contents of lead and MSG.
Uttarakhand principal secretary health Om Prakash said the decision to ban the sale of Maggi was taken on Wednesday night in public interest.
“We are informing all the 13 districts about the decision (to ban) Maggi. We are also sending them a formal order today,” BR Tamta, joint commissioner, Food Safety and Standards Authority (FSSA) told Hindustan Times in Dehradun on Thursday.
The Jharkhand government is likely to take a decision later in the day after laboratory results come in while Maharashtra is likely to take a call on the issue on Friday.
Officials in other states including Bihar, Assam, Arunachal Pradesh and Rajasthan said they have sent Maggi samples for laboratory tests.
Bihar chief minister Nitish Kumar said in Patna the government was investigating the issue and action “will be taken on the basis of report of laboratory tests” done on samples.
Nestle India’s stock fell by 2.91% to settle at Rs 6,010.80 on the Bombay Stock Exchange. During the day, it slipped 6.31% to Rs 5,800.10. On the NSE, the stock ended with a loss of 2.94% at Rs 6,004.45.
In Wedesday’s session, the stock had lost 9%. The company’s market valuation has dipped Rs 7,680.44 crore to Rs 57,953.56 crore in two consecutive trading sessions.
“The Maggi issue has dented the stock heavily. The stock is generally an outperformer even when the markets are down,” said Vinod Nair, head for fundamental research Geojit BNP Paribas Financial Services.
Stressing food safety, Walmart took the popular brand off shelves.
“Given our utmost focus on ‘food safety’ and ongoing concerns around this product, we have withdrawn the Maggi 2-minute noodles from our shelves across all 20 Best Price Modern Wholesale stores till further clarity…,” a Walmart spokesperson said.
Germany-headquartered Metro AG has also discontinued Maggi sales in its 18 cash and carry stores across the country.
Likewise, consumer cooperative society Kendriya Bhandar also withdrew Maggi noodles from its 130 stores in and outside Delhi.
Source:hindustantimes
Tags: Maggi row, Nestle's stock falls, Uttarakhand
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